News briefs

Laws hinder adoption of health IT, study says

Legal barriers posed by certain fraud and abuse, antitrust, federal income tax, intellectual property, malpractice, and state licensing laws hinder providers’ adoption of health information technology, the Government Accountability Office (GAO) concluded in a recent report.

"Because the laws frequently do not address health information technology (IT) arrangements directly, health care providers are uncertain about what would constitute violations of the laws or create a risk of litigation," the report says. Such "uncertainties and ambiguity in predicting legal consequences" make providers reluctant to invest significantly in IT.

The Physician Self-Referral or "Stark" Law and anti-kickback law, for example, make providers wary of establishing arrangements between providers that could promote adoption of health IT, the report continues.

GAO stated that, while the Department of Health and Human Services, which is charged with fostering broader adoption of health IT, has attempted to address some of those barriers, the agency’s efforts have not been sufficient to overcome providers’ concerns. The report is available at

CA bill sets minimum for hospital discount

The California legislature passed a bill (SB 379) in late August that would require hospitals in the state to provide financial assistance in the form of charity care or payment allowances to uninsured patients whose income is at or below 400% of the federal poverty level. Gov. Arnold Schwarzenegger did not immediately indicate whether he would sign the legislation, which was opposed by two state health care agencies in the executive branch. The California Healthcare Association (CHA) also opposed the legislation, noting that hospitals across the state already are addressing the issues on a voluntary basis.

In February, the CHA adopted voluntary guidelines for assisting low-income uninsured patients that recommend member hospitals provide financial assistance for patients at or below 300% of the federal poverty level. The guidelines also recommend hospitals limit expected payments from such patients to amounts received from Medicare and other government-sponsored health programs, do not garnish wages or place liens on primary residences to collect unpaid bills, and clearly post and communicate their financial assistance policies to patients.

Hospital chain plans discounts for uninsured

Triad Hospitals plans to implement a new discount program for uninsured, self-pay patients at its 51 hospitals. The plans are subject to local restrictions. Company officials said each hospital would offer a blanket discount of a certain magnitude based on its location, and that patients also would be able to apply for further discounts based on their financial means. The Plano, TX-based company estimates that the new self-pay discount program will have no significant net impact on earnings per share, and said it will monitor and report on the financial impact of the program following implementation.

For more information, see the announcement at under "News."

JCAHO panel to assist with cultural issues

The Joint Commission on Accreditation of Healthcare Organizations (JCAHO) has appointed an expert panel to assist in a study of hospitals’ efforts to address cultural and linguistic issues that affect patient care. The 2½-year study will attempt to identify best practices for providing culturally and linguistically appropriate care in hospitals, and could play a role in future JCAHO accreditation standards. The study will involve site visits to a sample of 60 hospitals starting in May 2005.

The panel, which first met in July, will advise JCAHO in selecting hospitals for site visits, determining what information to collect, and developing a survey tool and protocol for collecting information.

For a list of panel members, see the press release at

Moody’s forecast dim for nonprofit providers

Nonprofit hospitals and health systems were given a dim forecast in a recent report from Moody’s Investor Service, despite such positive developments as payment increases due to the Medicare Modernization Act. The credit rating agency said the negative outlook is based on flat inpatient and outpatient volume growth; lower growth in reimbursement rates from both public and private payers; increasing expenses, particularly employee salaries and benefits; and looming capital needs.

Bad debt as a percentage of net patient revenue increased significantly, Moody’s noted, attributing the increase to the shift of more health care costs to consumers through higher copayments and deductibles. Though this year’s median financial results are only "modestly negative" and "relatively comparable" with 2003 results, Moody’s said it believes the median results are lagging indicators.

HIPAA rule’s effect on states explained

A new set of frequently asked questions (FAQ) posted by the Department of Health and Human Services Office for Civil Rights explains how the HIPAA privacy rule relates to state public records laws, also known as freedom of information laws.

According to the FAQ, the privacy rule permits a covered entity to use and disclose protected health information as required by other law, including state law. But when a state public records law permits but does not mandate the disclosure of protected health information, or when exceptions or other qualifications apply to exempt the protected health information from the state law’s disclosure requirement, such disclosures may not be permissible under HIPAA.

For more information, go to